Sweet Equity

Sweet Equity

Entrepreneur by Mark Gordon | Managing Editor

A literal hands-on entrepreneur learns how to grow by letting go. After starting the business on $6,000 in combined family savings, he's grown it to $10 million in annual revenues.

Matt Uebelacker was pumped when he landed two well-known local homebuilders for his new cabinetry business in 1981. Then 22, Uebelacker figured he was well on his way to justifying spending his - and his wife's - entire family savings of $6,000 on the startup.

The excitement quickly turned sour though, as Uebelacker was told by Charlotte County officials the 1,000-square-foot warehouse he was renting had to be shut down because a fire wall was not up to code. Making it worse, he couldn't do the job at his house, because his one-bedroom starter home didn't have a garage, or even a carport.

But the determined Uebelacker, now 46, didn't let that stop him: He lugged his saw and a compressor to his nearby parents' house and set up shop in their garage. "If I didn't do that," Uebelacker says, "I would have lost those accounts and I didn't want to do that on my first job."

Uebelacker has grown considerably in the 25 years since he hammered and sawed his way through his first job: His Busy Bee Cabinets, now based in North Port, a few miles north of Charlotte County, is expected to have about $10.5 million in 2006 revenues and has grown about 25% a year over the last five years. He has about 80 employees, including five he recently hired as part of a half-million dollar expansion to add a line of Thermofoil doors to the company's product line.

As a result of the growth and strategy, the Economic Development Corporation of Sarasota County selected the company as its 2006 Manufacturer of the Year.

A pair of homebuilding booms has aided the growth: One in the early 1980s, just as Uebelacker was starting up, and the more recent one that began dying off this year. The scope of the recent boom has allowed Busy Bee to expand its geographic reach, too. From its start entirely in Port Charlotte, it now works regularly in all the counties from Manatee to Collier, in addition to having a few jobs in the Tampa Bay area. It has anywhere from 300 to 400 projects a month going on, from custom single-home jobs to multiple housing complexes.

One current project zeroes on both Busy Bee and Southwest's Florida's growth: The company is currently installing $195,000 worth of cabinets, shelves and doors in one Punta Gorda house.

Consistently good

Uebelacker attributes his success to hard work more than a firm strategy designed solely to get bigger. The attitude stretches as far back as high school, when he worked virtually full-time for a Port Charlotte cabinetmaker in the late 1970s while going to school at the same time.

And when he started his own business, it was an every waking hour operation: He worked from 6 a.m. to midnight most days, as did his wife, Diana Uebelacker, who quit her job at a local bank to work with her husband. "That's what it took to get the business going," he says.

The challenges in the early 1980s for Uebelacker revolved around surviving on a weekly, if not a daily basis. In some ways, the task is still the same today, but with higher stakes. Now he has multiple work crews and staff that call for a $90,000 monthly payroll. He's setting up jobs for a year in advance to make sure that obligation is covered.

Uebelacker's calling card has been consistency. He says that holds true in every aspect of customer service, from sales calls to installation. For example, the crews make site visits at every homebuilding location to work with builders in determining when the cabinetry should installed.

What's more, there is a constant approach to making sure each product is top-shelf quality. Systems for checking over a project when it's loaded into the truck and after it's installed have long been in place. To that routine, Uebelacker recently added a third component by having three employees be fully devoted to driving to sites in all Gulf Coast counties to monitor projects.

Owning is better

Another side to Uebelacker's consistent approach is in how he treats customers, especially on the pricing side. He says he saw competitors arbitrarily raise prices during boom times of the early part of the decade, as cabinetmakers were in demand. Those same shops are desperate for work now, going low on prices just to have cash flow, Uebelacker says. "We didn't up our pricing when we could have," Uebelacker says. "We didn't take advantage of our clients."

Uebelacker didn't ignore the pending residential slowdown, either. Sensing an end to the good times, he pushed his sales force to be more aggressive in closing deals as far back as early 2005, to protect itself against a downturn. He's hoping to avoid a repeat of the early 1990s building recession, when he had to scale back some employees' hours and lay off a few other workers.

Uebelacker has been consistent on investing in the business, too. He has bought several buildings and plots of lands to build on over the years, saying owning outright gives him the equity and allows him to grow quicker. His first purchase was in 1982, when he bought a building in a Port Charlotte industrial park for $45,000.

Busy Bee moved into its current 33,000-square-foot headquarters, a mile from the Toledo Blade Boulevard exit off Interstate 75, in 1981. The assembly line inside has been tinkered with and upgraded over the company's 25 years, growing along with the industry.

Uebelacker remembers going to a woodworking trade show in 1987 and paying $90,000 for a computerized saw, now an industry staple. It was one of his first big-ticket purchases. "It was a big step," he says, but "it was an eye-opening experience to see what good equipment could do."

Letting go

As the company grew, Uebelacker learned several valuable entrepreneurial lessons; one of the most significant ones, he says, was figuring out how to let others do work he once did by himself. Like many entrepreneurs, letting go proved to be a difficult task, especially when he saw people doing the nuts and bolts work of putting stuff together he once did himself.

But about ten years ago, he says, after he was in the multimillion dollar annual revenue range, he realized that to continue growing at about 25% a year he would have to be more trusting of his employees. It was more of a gradual growth than a cold-turkey switch. "If you don't do it, you'll always be by yourself," he says. "Now I'm more of a businessman than a cabinetmaker."

Growth also put Uebelacker in a unique situation: Several of his best employees saw how well the company was doing and over the last few years they have branched out on their own, opening competing cabinetry shops. One of the new competitors is his brother, Bob Uebelacker, who now runs Cambridge Cabinets in Port Charlotte.

Uebelacker takes the high road on that issue, like a football coach who sees his assistants go off to other jobs. He's still friendly with all of the former employees and has even given them advice on various issues. Besides, he says, "there's always been plenty of work for good cabinet guys."

UEBELACKER'S ADVICE

Matt Uebelacker learned his cabinet-making skills in the late 1970s by working full time for a Port Charlotte-area cabinetmaker while still attending high school. Uebelacker developed his business skills in more of a learn-as-you go and trial-by-error method as his business, Busy Bee Cabinets, has grown during the last 25 years. "Now," Uebelacker says, "I'm more of a businessman than a cabinet maker." Here are a few tips from Uebelacker on how to maintain and grow a small business:

• Maintain good credit: Uebelacker isn't against spending money, proven by purchases including a $90,000 computerized saw and a $55,000 computerized dowel inserter. But he keeps a tight and constant payback schedule. He did that in the early 1990s and as a result "was almost debt-free" when a recession hit the homebuilding industry. That served as a cushion.

• Trade on information: Uebelacker went to his first industry trade show in 1987, where he learned how powerful and business-changing a computerized saw can be. Since then, he has gone to dozens of other woodworking and industry-related shows to see how others do it, check out new equipment and build up business contacts.

• Hire for the right reasons: Uebelacker plans ahead in preparation for big contracts and jobs, so that he doesn't have to rush to hire people. It lessens the risks of hiring employees who don't work out. Says Uebelacker: "Don't hire just to get out of a bind."